Athira Sethu
Kochi, 26 September 2025
U.S. President Donald Trump has signed a new round of import tariffs. From October 1, 2025, any patented or branded drug imported into the U.S. will be subject to a 100% duty. There is only one exception, i.e., for firms that are constructing new drug manufacturing facilities within the United States. If work has already begun, such products won’t be subject to the additional duty.
Trump also imposed new tariffs on other products. Kitchen cabinets and bathroom vanities will pay a 50% duty, upholstered furniture will pay a 30% duty, and heavy trucks will pay a 25% duty. Trump explained that the measures are aimed at defending U.S. industries and incentivizing companies to manufacture products in the country.
The news immediately rocked world markets. Japanese, Australian, and South Korean stock prices went down, as did Asian drug shares. S&P 500 futures lost earlier gains in the United States. Experts cautioned that the new tariffs could increase inflation, with medicine, furniture, and other goods rising in price.
Federal Reserve Chairman Jerome Powell already warned that goods prices are a significant contributor to still-high inflation. More tariffs would worsen the situation by driving up costs for consumers and curbing economic growth.
America brought in almost $233 billion in medicines in 2024. If some drugs double in price, healthcare expenses would jump precipitously. This would hit regular Americans, as well as government programs such as Medicare and Medicaid. Trump contended that the regulations won’t hurt companies already producing drugs in the U.S., but how they will be implemented is unclear.
It could have dire effects for India. India is among the world’s largest exporters of medicines to the U.S., shipping $12.7 billion worth of medicine in 2024 alone. Four out of every ten prescriptions filled in America are supplied by Indian pharma companies. Indeed, Indian generics have saved the U.S. healthcare system $219 billion since 2022 alone, and over $1.3 trillion since the last decade. If tariffs increase the cost of Indian medicines, American patients would end up shelling much more for basic drugs.
To diversify away from the U.S., India is now venturing into newer markets in Africa, Latin America, Southeast Asia, and even China. But as more than 60% of India’s raw materials used to produce medicines are sourced from China, the picture is far from clear.
Briefly, Trump’s new tariffs will make U.S. factories stronger but could increase prices for consumers, rattle world trade, and hurt Indian drug exporters severely.
